Image by First Aid Box London

The Office of National Statistics last year revealed a fall in global alcohol consumption for the first time this century. It has been widely reported that the proportion of young people choosing to drink alcohol and smoke cigarettes is the lowest on record. Meanwhile, the preoccupation with personal image continues to rise at an alarming rate. Our fixation with our image and our health is forcing retailers and alcohol brands to stand up and take notice. It is a shift in attitude that is fast reshaping the food and drinks brand landscape with new category winners and losers. With it come new challenges and opportunities that will disrupt business as usual for traditional players.

Some no and low-alcohol brands have emerged on top and are by nature well placed to compete and cater to new consumer demand. In recent days we have seen Tesco roll out the largest NOLO (No and Low) alcohol section in its history – a decision that will accelerate growth and bring more visibility to the category as a whole.

The question remains how far and how fast the NOLO category will grow. Whilst 1 in 5 young adults in the UK have turned away from alcohol altogether, 4 in 5 have not. With the NOLO category accelerating, does this encroach on the territory of traditional alcoholic drinks? The increased preoccupation with health has not as yet created a nation of teetotallers so much as a nation of people that agree with (and actually abide by) the notion of ‘less is more’.

Across no, low and traditional alcohol brands we see resources pouring into new product development. Others are reassessing how they frame their ranges and concentrating funds and efforts on evolving the consumer experience on and off-trade.

The challenge for drinks brands looking to have a portion of the fast-growing ‘free-from’ (or ‘less-is-more’) pie will be to design products and experiences that don’t just ride the wave, but actually influence a shift in mindset and a resulting change in behaviour.

As a retail and branding design agency with extensive experience in the drinks category we ourselves started to take notice of the trend through our clients. We decided to investigate and focus in on three behavioural pillars that seem to be having the most notable impact in boosting growth in the category, both for NOLO brands and for the alcohol brands that are succeeding at reinventing their offer: ‘Wellness’, ‘Brand Me’, and ‘The New Counterculture’. In this piece we investigate how brands are adapting and in turn influencing new behaviours through design – from product and experience, through to purchase.

Image by Sephora

Missouri was recently invited to give a presentation to an ISBA group, about the ‘changing face of retail’. Here’s a short summary of what we talked about:

A change of pace in customer expectation has brought unprecedented challenges for retailers in recent years and shows no signs of slacking off. In a multi-channel world of smart technologies, fast and furious pace of life and high levels of competition, retailers and brands are all thinking outside the box and fashioning fresh tactics. You need to be smarter than ever to maintain relevance, not just by stepping outside the box, but by pulling apart the walls to reshape it completely.

Despite the doom-mongering, stores are succeeding; according to econsultancy, 84 per cent of retail sales still take place in store and of the 16 per cent of online transactions, 66 per cent are made following a store visit.

Retailers are rising to the challenge of the demand to shop anytime, anywhere, reaching inflated expectations of service levels. We’re seeing a fast-adapting face of retail with disruption rife and many are disrupting traditional models; Tesla eschewed sales-led ‘big box’ dealerships for brand-building experiences in shopping centres, and Sneakerboy opened stock-free experience stores in Melbourne with online ordering. Even online retailers are disrupting new ecommerce models with bricks and mortar stores that combine the best of physical and digital retail to cater for evolving customer demands.

Image by Sneakerboy Australia

Many retailers are forging stronger connections with customers by curating experiences – going beyond displaying and selling products, to become community hubs and places of entertainment, exploration and discovery.

Others are focusing on ‘real-time retail’. Taking a leaf from the book of digital and reflecting non-linear paths to purchase, they’re creating dynamic experiences that respond to individual customer demands through flexible formats, instant access to service and information, and collection of data and connectivity. Electronic communication enables immediate attention in an environment that responds to factors such as time of day, day of week, weather and customer feedback.

Smart technology is being used to create more innovative stores and increase engagement between brand and consumer; they can identify individual customers’ expectations to streamline paths to purchase, personalise experiences and rewards, and reduce the effort involved in accessing discounts.

Far from diminishing the role of the physical store to acquire and guide a sustained relationship between customers and brands, we see technology accentuating opportunities to connect with brands and facilitate purchase.

These are exciting times for retailers. With opportunities to win and to retain more customers beckoning for those that create smart stores omni-channel experiences, the physical store will remain of central importance in the delivery of brand promises.

Our presentation contains over 20 inspiring, innovative and informative examples. We’ve told you the story here but true to our mantra, we’d love to show you real-life examples.